Under what circumstances does the Operating Principal equity ownership requirement not apply to a Hardees franchisee?

According to Hardees' 2025 Franchise Disclosure Document, the requirement that the Operating Principal have at least a 10% equity ownership interest in the franchisee (or the franchisee's general partner, if the franchisee is a limited partnership) does not apply under specific conditions. This equity ownership requirement can be modified at Hardees' discretion.

Specifically, the 10% equity ownership requirement does not apply if the franchisee was a publicly-held entity or a wholly-owned subsidiary of a publicly-held entity as of the date of the first franchise-related agreement between the franchisee and Hardees.

This exception is significant for prospective Hardees franchisees because it clarifies the ownership structure requirements. If a franchisee already operates as a public entity or a subsidiary thereof, they are exempt from the standard 10% equity ownership rule for the Operating Principal. This could make Hardees franchising more accessible to larger corporate entities already structured in this way.